Santa Monica City Hall Seeks New Funding Sources For Affordable Housing
Posted Dec. 26, 2012, 6:00 am
Parimal M. Rohit / Staff Writer
Santa Monica City Hall stressed earlier this month it must find new ways to fund and support affordable housing programs in Santa Monica. At its Dec. 11 meeting, Council members directed City staff to look into a few avenues to bolster revenues to infuse cash into affordable housing.
With the council direction, City staff will explore the possibility of assessing an affordable housing fee on all commercial development and sell as many as three City-owned properties, including Mountain View Mobile Home Trailer Park at 2930 Stewart Street.
Other directions included the amendment of the Affordable Housing Production Program “to support extremely low-income housing, to establish minimum occupancy standards, and to allow for for-profit developers to contract with non-profit developers for affordable housing,” and the cessation of offering new loans under the Santa Monica specific TORCA, or Tenant Ownership Rights Charter Amendment, program.
Council members and City staff discussed the alternative funding options in light of the loss of redevelopment agency, or RDA, money earlier this year. To keep up with the high demand for affordable housing, City Hall hoped to cut a few internal costs while also seeking new funding sources.
“With the dissolution of redevelopment, the majority the Housing Trust Fund Dollars, as well as our ability to leverage outside funding, is gone,” a City staff report stated. “If Santa Monica wishes to continue to create affordable housing opportunities at a significant scale, new sources of revenue must be identified.”
According to staff, City Hall’s Housing Division annually invested nearly $15 million in Housing Trust Funds to finance affordable housing through loans and grants to non-profit housing developers.
“The investment of local Housing Trust Fund dollars has leveraged an additional $15 to $20 million annually from private investors and institutional lenders,” City staff stated before indicating such funds are no longer available.
Andy Agle, the City’s director of housing and economic development, said RDA funds have provided at least 75 percent of funding for affordable housing.
“In the last few years, it’s been close to 90 percent,” he added.
During his staff presentation to the council, Agle also suggested the City look into taking advantage of potential funding from the County of Los Angeles, where some of the residual RDA funding was redirected.
Beyond funding sources, with about 2,000 households within Santa Monica currently on a wait-list for affordable housing, Agle also suggested the council consider incorporating an “extremely low-income option” in the City’s Affordable Housing Production Program.
The commercial development fee was well received by Council members.
“We should indeed be pursuing a commercial development linkage fee,” Council member Kevin McKeown said. “That is an obvious way for us to help provide the housing for the workers the commercial development is going to bring to our town.”
McKeown added City Hall’s pursuit of funds from the County was a good idea, but also expressed reservation about whether Santa Monica will actually receive any money from that source.
Council member Gleam Davis pointed out City staff should look into whether it makes sense to require small developments, such as a five-condominium project, to be required to include affordable housing units. She stated compliance and enforcement in such situations might be too cumbersome.
City staff expects to return to the council with a commercial development linkage fee proposal in early 2013.